How to Automate Invoice Creation with AI-Powered OCR

Learn how to configure automated invoice creation in Precoro and save your AP team 80% of their time.

TABLE OF CONTENTS

• How to Save 80% of Time on Invoice Processing with Automation
• How to Enable Automated Invoice Creation

• How Precoro Matches Invoices with Purchase Orders

• Additional Matching Rules for Invoice and Purchase Order Processing

• How to Customize Invoice Matching Rules

• Best Practice Use Cases for Matching Functionality

• Frequently Asked Questions

How to Save 80% of Time on Invoice Processing with Automation

Processing invoices manually is time-consuming and prone to errors. With Precoro’s AI-powered OCR, you can automate data entry, match invoices to POs automatically, and speed up payments — all while cutting AP workload by 80%.

Here’s what you can expect using the automated invoice creation in Precoro:

• Invoices are automatically captured, created, and matched to purchase orders, significantly reducing the time from receipt to approval.
• Eliminate the need for manual data entry, freeing your team to focus on higher-value tasks.
• Automated matching minimizes errors, ensuring invoices align with purchase orders and financial records.
• Maintain consistent and accurate records, making audits and compliance checks simpler and more reliable.
• Faster invoice processing provides clearer visibility into payables, helping you optimize cash flow and avoid late payment penalties.

How to Enable Automated Invoice Creation

To minimize manual effort, Precoro allows you to automate invoice creation based on documents sent by suppliers. Once set up, the system handles the heavy lifting—all you need to do is review the invoice for accuracy and proceed with your day. Here’s how to enable this feature:

1. Go to the OCR Document Processing page: US server link or EU server link.
2. Check the Invoice from Order Auto Creation box.
3. Enter the email of the person to be assigned as the default initiator of auto-created invoices.
4. Choose the type of invoice to auto-create:

• • Standalone Invoices: An invoice will be created if no matching PO is found.

  • PO-Based: An invoice will be created only if it matches an existing PO. You can also choose matching rules for the invoices. Learn more about them here.

  • Enable both options to create invoices based on either matching a PO or as a standalone if no PO exists.

How Precoro Matches Invoices with Purchase Orders

Precoro automatically scans each incoming invoice to link it with an existing order and help you pay only for what was originally ordered. Invoices are matched to the following order types:

• Standard Purchase Orders

• Blanket Purchase Orders (by Total or by Item)

• Service Orders

The system searches for a corresponding PO by comparing details like:

• PO Number: The PO number on the invoice must match the PO IDN or custom number.

• SKU or Item Code: Verifies that the SKU or item code on the invoice aligns with the code on the PO.

• Name or Description: Ensures item names or descriptions match between the invoice and the PO.

• Rate: Confirms the rate per item on the invoice corresponds to the PO rate.

• Net and Gross Total Amounts: Compares the invoice amounts with the PO totals.

• Line Count: Checks that the number of line items on the invoice matches the PO.

If Precoro finds a match, the system automatically associates the invoice with that PO. However, if the data on the invoice doesn’t match any PO, Precoro will generate a standalone invoice. Items from invoices that have been matched will affect the budget and be displayed within the budgeting information. 

Additional Matching Rules for Invoice and Purchase Order Processing

To increase the number of documents created automatically, we’ve added new matching rules for invoices processed with OCR. These rules improve accuracy when matching invoices to purchase orders.

Here are the new matching rules that you can choose for your invoices:

• Invoice line SKU or code matches the PO line SKU

• Invoice line name or description matches the PO line name

• Invoice line rate matches the PO line price

• Invoice line amount matches the PO line Net Total

• Invoice line amount matches the PO line Gross Total

• Invoice total matches the PO Gross Total

• Line count on the invoice matches the line count on the PO

Additionally, these default rules are always applied and cannot be removed:

• PO number on the invoice must match the PO IDN or custom number

• Invoice will match to the PO if only one PO is available

How to Customize Invoice Matching Rules

Precoro offers customizable invoice matching rules to align with your company’s policies and accuracy requirements. These rules determine how invoices link to POs. You can choose between two mapping options:

• Selective Mapping: Documents must match at least one of the selected criteria.

• Complete Mapping: All criteria must be met for a match, ideal for strict data accuracy needs.

To apply or adjust these settings, contact Precoro’s Support Team.

Best Practice Use Cases for Matching Functionality

Below are practical examples to help you decide on the best mapping configuration for your needs: 

User Scenario	Example of Mapping Settings	Mapping Type	Usage Benefit
For users needing strict accuracy between Invoice and PO amounts	✔️Invoice line amount matched to PO line Net/Gross Total ✔️ Invoice amount matched to PO Gross Total	Complete Mapping	Ensures rigorous cost control and accurate expense tracking, essential for adhering to project budgets.
For users requiring fast document creation with fixed amounts	✔️ Invoice line amount matched to PO line Net/Gross Total ✔️ Invoice amount matched to PO Gross Total	Selective Mapping	Enables rapid document processing if supplier documents are reliable.
For users with clearly defined POs and suppliers who meet exact requirements	✔️ Invoice line SKU/code matched to PO line SKU ✔️ Invoice line name/description matched to PO line name ✔️ Line count matching (Invoice lines = PO lines)	Selective Mapping	Facilitates quick document creation without additional checks.
For small companies managing moderate supplier relationships	✔️ SKU or Code Matching ✔️ Name or Description Matching	Selective Mapping	Simplifies compliance checks, helping ensure Invoices reflect Purchase Orders accurately, crucial for budget control and supplier management.
For large corporations needing high accuracy for audit compliance	✔️ All matching rules applied, including Total Invoice Amount and Line Count Matching	Complete Mapping	Ensures maximum accuracy and compliance during audits, reducing financial risk and promoting transparency, though it may require more manual work.
For companies with stable commodity prices and large catalogs	✔️ Rate Matching (Invoice line rate matched to PO line price) ✔️ Invoice line amount matched to PO line Net/Gross Total	Selective Mapping	Supports procurement accuracy, particularly for standardized orders.
For standard orders in medium-sized companies	✔️ Invoice amount matched to PO Gross Total ✔️ Line count matching (Invoice lines = PO lines)	Complete Mapping	Ideal when item counts remain constant, though product names may vary slightly.

Frequently Asked Questions